Okay, getting back to the original question. I'm going to disagree with Hammond and Kman: I don't think Maxwell Street would be a good destination for your students' purposes. Yeah, they might utter a few Spanish words there, but after saying "Dos tacos de carne asada, por favor" and "Gracias" the interaction is over.
Instead I'll recommend three inexpensive sit-down places, all on the near Southwest Side.
(1) In general, the La Villita neighborhood (26th St. west of California) is one where the waitstaff is likely not to speak English and so you have to use some Spanish. A specific place your students could go to would be
La Kermes, a big place with lots of booths, lots of families eating there, and plenty to choose from on the menu. (I think their gorditas with rajas and queso are particularly good.)
(2) In Pilsen, it seems, the restaurant workers are more accustomed to serving English speakers but I'm sure they'd be happy to help students practice their Spanish. I recently recommended
Nuevo Leon in another
thread, and it would be a good choice for high school students as well. It's on 18th Street just east of Ashland.
(3) A little further south, on Ashland just south of Cermak, is a branch of
La Condesa, another mid-level, sit-down restaurant which won't be too expensive. There are other branches in other neighborhoods, which I expect would also be good choices.
Taqueria La Kermes
3002 W. 26th St.
773-523-1666
Nuevo Leon
1515 W 18th Street
Chicago, IL
312-421-1517
La Condesa Restaurant 3
2230 S. Ashland Ave.
773-376-0078
other branches of La Condesa that I was able to find on google:
La Condesa Two
1003 N. Ashland Ave.
773-276-5121
La Condesa 5
2908 W 59th St
Chicago, IL 60629
(773) 737-2700
(Are there also La C 1 and La C 4? I have no idea...)